Chargeback (Dispute)

Category: business

A process where a cardholder successfully challenges a transaction through their bank, resulting in a forced refund from the merchant.

Chargebacks are a major operational friction. When a bank initiates a chargeback, the merchant loses the original transaction amount plus a "dispute fee." A high chargeback ratio (usually >1%) can lead to the gateway banning the merchant’s account for being too high-risk.

Common Examples

• We proactively monitor for chargeback triggers, such as unrecognized bank statement descriptions, to resolve customer dissatisfaction before it hits the bank level.
• Frequent chargeback requests on high-value digital services often signal fraudulent use of stolen payment credentials.